Notorious Zimbabwe Swindler Allowed To Resume Life In South Africa

Rautenbach free to live south of Limpopo print friendly version
author/source:Business Report (SA)
published:Sun 27-Sep-2009
posted on this site:Mon 28-Sep-2009
Article Type : News
Some say that he would like to get out of the clutches of Zanu PF, and, now that he can, move to South Africa
By Peta Thornycroft

The past few days have been good for Zimbabwe's rich and controversial businessman Billy Rautenbach. He is spending his 50th birthday at his hunting camp on the lower Zambezi this weekend after paying a R40 million admission of guilt fine for fraud in South Africa and is now free, after 10 years, to resume his life south of the Limpopo. The fine was petty cash considering that in the same week he made about R730m for his share in a British company listed on London's alternative markets. Whether he will get the money or it will be frozen - as he is on the EU and US sanctions list - is not clear. Allegations against Rautenbach in South Africa 10 years ago were that his company, SA Botswana Hauliers, operating out of Botswana and assembling Hyundai vehicles, had massively fiddled customs duties and the SA Revenue Service. Shortly before he fled to Zimbabwe Rautenbach's company was put into liquidation.

Protected by political allies in Zimbabwe from extradition to face trial in South Africa, the complex case against Rautenbach's company became stale and insiders said eventually it was a headache for the National Prosecuting Authority - easier to settle than process through court. The source of Rautenbach's wealth is well documented with its origins in the extraordinary assets he was given, firstly from the spoils of war in the Democratic Republic of Congo (DRC), and secondly by President Robert Mugabe's henchmen in Zanu PF. He used the gifts well, if ruthlessly, and worked hard, developing good contacts among officials in both the DRC and Zimbabwe. He is not a miner, and the DRC and Zimbabwe are wild countries where a bribe to mining officials to circumvent problems happens all the time, according to industry insiders.

Rautenbach is lean, of medium height, with a mane of grey hair and a stable family life and he has successfully avoided press photographers so the last available images of him go back 10 years to just before he fled to Zimbabwe. After escaping ahead of charges in South Africa, Rautenbach was recommended by Zanu PF to head up the DRC's enormous, bankrupt, disintegrated state mining company, Gecamines, after Mugabe had stepped in with his army to save his ally, Laurent Kabila, in the civil war that had sucked in five neighbouring countries. Gecamines was more than just a massive conglomerate with extraordinary mineral assets, it was a source of survival for generations of the labour force, which depended on the company from birth to death, regardless of production and plunder by Mobuto Sese Seko, the president of the DRC, then known as Zaire. Gecamines was a shadow of what it had been when the Belgians fled 40 years or so earlier.

Rautenbach, by all accounts, slashed overheads, boosted production of cobalt in particular, established some financial sense in the mining empire but offended the unionised workforce. Kabila, in fragile control of the DRC after the country's years in the wilderness, accused Rautenbach of cheating Gecamines of cobalt revenues and expelled him from the country. He took back the gifts of mining assets of the three rich sites he had been given, including the famous Mukondo cobalt mountain in Katanga province, which Rautenbach was mining. Expelled from the DRC Rautenbach fled to Zimbabwe again and took the DRC to court for the return of the assets he had been given. In 2004, and with Kabila dead, half of the assets were returned after powerful Emmerson Mnangagwa, who leads a faction in Zanu- PF, and is determined to succeed Mugabe, intervened.

Rautenbach returned to Katanga, and sold a substantial part of his mining and transport companies to the Central African Mining and Exploration Company (Camec), led by British cricketer Phil Edmonds and British chief executive Andrew Groves. It was not a happy company. South African engineers were hauled off to a kangaroo court Groves set up to allegedly deprive them of share options in the company. Another in the South African team employed by Camec had to flee the country ahead of DRC intelligence agents allegedly put on him by Groves. Camec's name was dirt, as dirty at least as some of the Congolese officials demanding bribes. Camec did, however, mine and set up plants in the DRC and, after Rautenbach was expelled again, after an application for his extradition to South Africa was lodged in Zimbabwe, he ran much of it long distance from Harare.

In Zimbabwe, Rautenbach was busy. With his influence, Camec was handed two platinum sites, and paid $100m into Zanu PF for assets that would take more than Camec's resources or skills base to develop. Rautenbach formed a new company, Cutstar, and he is now in effect in control of the largest chunk of rural land in Zimbabwe, when most of the remaining few hundred white farmers are under constant harassment. Rautenbach says he is going to grow sugar and produce biofuels. That development has hardly begun and the sugar industry says he does not have access to enough water to grow more than a token amount. Right now, he is stocking the land he was given with buffaloes secured from the Hwange National Park. The buffaloes will endanger the remaining large cattle in the area but will make the land more attractive for sale as a tourist asset.

Many white businessmen have had a hard time in Zimbabwe in the last 10 years. Most, especially in the retail trade, say that they lost 95 percent of their asset base when Zanu PF slashed prices two years ago and Zanu PF insiders, and others, walked into the shops and looted them. Others were locked up on the orders of central bank governor Gideon Gono for using scarce foreign currency to import goods to keep their businesses going. Serious mining executives had to go into hiding to avoid arrest. While farmers have been harassed and beaten, Rautenbach's family beef farm, 200km north of Harare, has remained untouched. It seems that he was, and is, a law unto himself in Zimbabwe, and it is believed that most of his external assets are hidden offshore, in the Virgin Islands for example. Some say that he would like to get out of the clutches of Zanu PF and, now that he can, move to South Africa. He has assets here, secured during his company's dubious Hyundai days.

Should he leave Zimbabwe, and and cut his ties with his benefactors in Harare, many in the battered business community would feel a sense of relief. A few months ago he was telling Western diplomats and anyone prepared to listen that he had made progress in putting his case to Prime Minister Morgan Tsvangirai's Movement for Democratic Change (MDC), the senior partner in a difficult unity government where Mugabe blocks every possible positive development. At the top of the MDC, however, indications are that he has made no progress whatsoever. He is seen as a stooge of Zanu PF, which has destroyed the economy. EU and US sanctions against Rautenbach are not going to be lifted easily. He has few friends in any sector in Zimbabwe, many have been angered by his short temper and the selective justice he appears to enjoy and, on a more mundane level, some of his suppliers wonder why he takes so long to settle bills in what is a cash economy.

"It's always been my goal to return to South Africa to pursue potential business opportunities once my name was cleared," said Rautenbach in a press release released by his public relations executives last week. "It's been a frustrating time of exile for me having to watch the evolution of business in South Africa and being unable to make my contribution." Clearing his name, however, among those bruised by his favoured status, may take a bit longer. "Billy Rautenbach's fortunes stem from gifts from political leaders, nothing else," a former associate from Katanga said on Friday.

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